When should companies self-report wrongdoing to the SFO?

The Serious Fraud Office (“SFO”) has made public the chapter from its internal operational handbook which provides guidance to its case controllers on the approach to and operation of deferred prosecution agreements (the “Guidance”). By publishing the Guidance, the SFO hopes to provide further transparency on what it expects from companies looking to co-operate with the agency with a view to being offered a deferred prosecution agreement (“DPA”) and establish best practice. The Guidance will be of interest to companies that suspect wrongdoing in their business and are considering the next steps to take.

The Guidance

The Guidance covers the entire DPA process and makes for detailed reading. Much of the Guidance sets out principles already established in the DPA Code of Practice written in conjunction with the Crown Prosecution Service and first published in February 2014 and other official guidance, such as the Joint Prosecution Guidance on Corporate Prosecutions. It includes information on the DPA negotiation process and the factors indicating that a DPA may be in the public interest. However, the Guidance also provides additional practical detail on a number of challenging issues faced by companies, including considering whether to self-report wrongdoing to the SFO.

When to self-report

Self-reporting wrongdoing is stated to be an important aspect of co-operation. The Guidance clarifies that companies wishing to be considered for a DPA should self-report suspected wrongdoing “within a reasonable time of those suspicions coming to light”. This echoes the position set out in the DPA Code of Practice, which notes that a failure to report wrongdoing “within reasonable time of the offending conduct coming to light” is a factor that may be taken into account by a prosecutor when deciding whether to enter into a DPA. 

Companies have been grappling with the question of what is a “reasonable time” since DPAs became available. The current director of the SFO, Lisa Osofsky, has indicated that she would expect a company to undertake at least some steps to confirm the existence of possible wrongdoing before approaching the agency, although she would expect a self-report once the position had been established. This approach differs to that taken by her predecessor, Sir David Green, who warned against internal investigations that “muddied the waters” and company-appointed lawyers who “churned up the crime scene”, making the SFO’s own investigation more difficult. 

The interaction with “co-operation”

The need to self-report was challenged by the agreement of a DPA with Rolls-Royce in January 2017. Despite failing to self-report at all – its wrongdoing was disclosed by a third party - Rolls-Royce was ultimately offered a DPA, its “extraordinary co-operation” with the SFO’s investigation being cited as a major factor in the prosecutor’s decision. More recently, in January 2020, Airbus was able to reach a global settlement with authorities in the U.S., UK and France resolving allegations across 16 jurisdictions despite only reporting the misconduct after it had been uncovered by a third party. Airbus’ subsequent co-operation with the investigation was considered to be “exemplary” and its positive action, which included complete board overhaul, proactive commitment to co-operation, disciplinary action against individuals, ongoing discourse and disclosure, internal investigations and waivers of privilege over witness accounts, meant that a DPA was still in the public interest. (Our earlier blog post, “Airbus lands €3.6bn global bribery settlement”, provides more details.)

The Guidance must also be read in conjunction with other guidance documents published by the SFO. In August 2019 the agency issued its corporate cooperation guidance, which outlines what companies can do to assist the SFO in its investigations in order to be seen as cooperating. According to that guidance, good cooperation will include identifying suspected wrongdoing and criminal conduct, together with those responsible, and reporting this to the SFO within a reasonable time of the suspicions coming to light (emphasis added). It also includes preserving and handing over evidence to the SFO. However, that guidance confirms that, despite full cooperation by a company under investigation, “[t]he SFO will retain full and independent control of its investigation process.”

Other factors

Furthermore, self-reporting misconduct is only one of many public interest factors that may point in favour of a DPA; these range from co-operation generally, a lack of history of similar conduct and that the company had been taken over by another organisation since the misconduct occurred, to collateral effects on the public, employees and shareholders. Much will depend on the circumstances.


The Guidance would seem to confirm that a company may undertake its own initial investigation into the suspected misconduct before it needs to consider hot-footing it to the SFO. But it should still be sure not to wait too long. For while the Guidance confirms that the failure of a company to self-report is not a bar to DPA negotiations per se, it will be considered as a factor when assessing whether a DPA is in the public interest. The DPA Code of Conduct (at paragraphs 2.9.2 and 2.9.3) states that the prosecutor will also consider how early a company self-reports and whether the failure to report earlier may have prejudiced the investigation when deciding whether to enter into a DPA.

So, while the newly published Guidance may offer a degree of clarity, every case will still turn on its facts.